By Debbie Strickland

After taking a four-month breather to find out why control patients were faring much better than expected, Alliance Pharmaceutical Corp. plans by the end of the year to resume North American clinical trials of LiquiVent (perflubron), under development for acute respiratory failure.

Hoechst Marion Roussel, of Frankfurt, Germany, is the marketing partner for the product, an oxygen-carrying liquid administered via a partial liquid ventilation (PLV) technique directly into the lungs of a patient who is being supported by a mechanical ventilator. The goal of PLV therapy with LiquiVent is to reduce the patient's exposure to the harmful effects of conventional mechanical ventilation.

In April, San Diego-based Alliance suspended a Phase III pediatric study in order to determine why the death rate, typically greater than 30 percent with conventional assistance from mechanical ventilators, was in the single digits among children in the trial's control group. At that point the study had enrolled approximately 200 patients with acute respiratory distress syndrome (ARDS).

"There was not a statistically significant difference between the mortality of the control vs. the LiquiVent group," Alliance spokeswoman Gwen Rosenberg told BioWorld Today. The company did not disclose further details about mortality rates.

The data analysis indicates there were changes in the patient age and disease etiologies after Alliance amended the trial protocol in December 1996. The amendment followed an initial 50-patient analysis that showed such positive results the company decided to expand the trial * doubling the enrollment goal to 1,000 patients * and make mortality the primary endpoint.

"When we changed the protocol, we changed the inclusion criteria because we wanted to get more patients," said Rosenberg. "In doing that, unfortunately, we ended up having design changes that resulted in an imbalance in patient populations."

It turns out that control patients enrolled after the trial redesign were substantially younger and had different risk factors for ARDS than the earlier controls. They also received additional therapies * such as extracorporeal membrane oxygenation, high-frequency oscillatory ventilation, nitric oxide and surfactants * more frequently, earlier and for a longer duration than both pre-amendment controls and LiquiVent-treated patients.

"The disproportionate application of these therapies and the risk factors for ARDS following the amendment confounded attempts to compare responses between the PLV [LiquiVent] and control groups," the company said.

Analysts endorsed Alliance's explanation.

"The great LiquiVent mystery appears to be solved," wrote analyst Daniel Lemaitre, of Cowen & Co., in Boston, though he predicted Alliance and Hoechst would "move forward cautiously."

Lemaitre reiterated his "buy" rating of the company's shares, while Steven Gerber, an analyst for Oppenheimer & Co., in Los Angeles, upgraded the stock to "outperform" from "market perform."

Gerber projected that LiquiVent could generate $500 million in sales by 2001.

"We still see the company as having little competition for the unserved respiratory distress market, and expect LiquiVent to be the gold standard for this condition," wrote Gerber.

Both analysts noted that Alliance has two other products nearing Phase III trials which have drawn big pharma interest. Oxygent, an intravascular oxygen carrier in development as a temporary blood substitute, is partnered with Johnson & Johnson, of New Brunswick, N.J. Imagent US, a diagnostic contrast agent, may have a marketing partner by the end of September if an agreement-in-principle with Schering A.G., of Germany, is finalized.

The company's shares (NASDAQ:ALLP), which plunged to below $6.50 in April when the LiquiVent trial was halted, have climbed back into the $10 to $11 range, closing Thursday at $10.25, down $0.125. As of March 31, Alliance had $70 million in cash.

Although a new adult trial is in the works, Alliance has not decided whether the pediatric LiquiVent trial will resume.

"We actually may have enough safety and dosing data for children to get an approval in conjunction with an adult indication," said Rosenberg. Separate physician-sponsored infant trials, which were also suspended in April, may also resume.

First, however, Alliance plans to launch a study in adults by the end of the year. The phase has yet to be determined.

"That is actually the primary patient population," said Rosenberg, "because the patients we are treating are all on mechanical ventilators, and 80 to 90 percent of all patients on ventilators are adults."

In a Phase II trial that compared LiquiVent to conventional mechanical ventilation as a treatment for adult acute hypoxemic respiratory failure, PLV with LiquiVent increased survival and significantly boosted ventilator-free days for patients under age 55 who met the study definition of the condition, regardless of their underlying injury or disease. An assessment of patients older than 55 could not be made due to the small number of control patients in that age group.

Alliance and Hoechst are working on a refined plan for LiquiVent development, expected to be finalized "shortly." *